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Pay Survey Practices - Part II

Pay Survey Practices - Part II. Measuring Pay Data Distributions: Normal - Bell shaped curve - rarely appropriate Non-Normal - pay data is unevenly distributed; more typical of pay data collected from surveys Measures of Central Tendency used to report Pay

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Pay Survey Practices - Part II

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  1. Pay Survey Practices - Part II Measuring Pay Data • Distributions: • Normal - Bell shaped curve - rarely appropriate • Non-Normal - pay data is unevenly distributed; more typical of pay data collected from surveys • Measures of Central Tendency used to report Pay • Median - the middle value of an ordered sequence of data • Mean - sum of data divided by numberof observations • Unweighted - each company is an observation • Weighted - each employee is an observation MGMT 4030 - Managing Employee Reward Systems

  2. Pay Survey Practices - Part II • Measures of Variation used to Report Pay • Range of Pay Data • Minumum, Maximum, Midpoint • Quartertile - 1st , 2nd (above midpoint); 3rd, 4th (below ) • Standard Deviation - distance of data from mean in a normal distribution. • Typical Market positions • Lead the market • Lag the Market • Match the Market MGMT 4030 - Managing Employee Reward Systems

  3. Pay Practices - Part II(Gomez-Mejia & Balkin, 1992) Recommended Pay Survey Practices • Relevance • Match on Job Descriptions (not Titles) • Consistent Use of Same Statistical Measures • Keep Pay Data Current • Monitor Effectiveness Using HR Benchmarks MGMT 4030 - Managing Employee Reward Systems

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